Intel, others fund Freenet creator's start-up

Uprizer, a peer-to-peer infrastructure company co-founded by
Freenet creator Ian Clarke, received a $4 million investment from Intel and
others Wednesday.

The investment will help the 8-month-old company bolster its management
staff and continue developing its technology, which is being built on
elements of Freenet, Uprizer said. Other investors in its initial round of
funding included Kline Hawkes and Shugart Venture Fund.

Clarke, one of the staunchest proponents of peer-to-peer networks' ability
to protect people's freedom of speech, is drawing on what he's learned from
developing Freenet to create a commercial venture targeting businesses
instead of consumers.

"There are some aspects of the Freenet architecture that are largely
unrelated to the philosophical underpinnings which we feel can work for
commercial purposes," said Clarke.

Uprizer's emergence comes as the enthusiasm for peer-to-peer technology
wanes from the initial flurry of investor and media attention that followed
the increasing popularity of Napster's file-swapping service. In the last
year, a series of copyright-infringement lawsuits against Napster and rival
Scour scared off venture capitalists and sapped fervor in the burgeoning
market. But behind the scenes, large investors including Sun Microsystems
and Intel have stepped in to buttress the industry's development.

Sun, through its new "Jxta"
project (pronounced "Juxta"), hopes to create a standard development
platform for peer-to-peer applications. Intel also set up a networking
standards group, of which Uprizer is a part.

Intel's investment is a further sign of its intense interest in the peer-to-peer market. The chipmaker has invested in peer-to-peer company
Groove Networks and similar concerns. It is betting that the growth of such
technology will use massive amounts of processing power and fuel demand for more powerful chips.

"Intel has a big interest in peer-to-peer. When you're talking about
'peer,' you're usually talking about a PC. And we supply the processing
power for the PC," said Robert Manetta, an Intel spokesman. "Uprizer has an
innovative application for content distribution, and we're interested."

Back to the roots of the Internet?
Clarke's first venture, Freenet, is a file-sharing network that allows
people to search for and retrieve files from individual computers around
the world. It was designed to prevent censorship and maintain people's
anonymity in the dissemination of information. This way, it is more
impervious to legal attacks than other peer-to-peer networks such as Napster.

Uprizer's first product, scheduled for release sometime in late summer, will
draw on Freenet's ability to cluster demand for information and deliver
that data more cost effectively.

"If 1,000 pieces of the same information from the U.K. were requested by
people in the U.S., it would travel overseas 1,000 times," Clarke
explained. "Through Freenet, it would travel once, making more efficient
use of the infrastructure.

"In doing that, you can get significant costs savings in terms of the
bandwidth required to distribute information."

Uprizer's technology will also pull from Freenet's approach to security. By
using strong encryption for content transferred between networks, the
inherent insecurity of hardware is mitigated, Clarke said.

Rob Kramer, Uprizer co-founder and chief executive, said that things are
moving quickly for the company and customers are lining up.

The product release could signal that peer-to-peer is growing up.
File-sharing technology from the likes of Napster, Freenet and Gnutella has
held a renegade, Libertarian image in the minds of staid corporations and
backers looking to squeeze dollars from the wild popularity of such free
services. By finding a commercial use for such technology, investors may
finally get what they're looking for.

In Clarke's view, peer-to-peer technology is the antidote to the trouble
that dot-coms created.

"P2P is the natural successor to the dot-com approach to the
Internet--we're getting back to the roots of the Internet," he said. "It is
part of the reality that the Internet is really about interaction, and
about participation, and not so much about these highly centralized
approaches from dot-coms."